Session 190

Building up Firm Capabilities for Unstable Environments

Track A

Date: Tuesday, October 13, 2009


Time: 10:00 – 11:15


Room: Meeting Room 13

Session Chair:
Pinar Ozcan, University of Warwick

Title: Social Heterosis: A Process Theory of How Firms Evade Competency Traps


  • Amandine Ody-Brasier, Yale University
  • Freek Vermeulen, London Business School

Abstract: This paper develops a model to explain how firms may avoid competency traps. We describe competency traps as evolutionary processes whereby a firm’s repertoire of routines becomes increasingly narrow, making it difficult to adapt to changing environmental conditions. We introduce the concept of “social heterosis”, which suggests the infusion of a small set of routines triggers a process of recombination within the organization. This process restores variety in the firm’s pool of routines and facilitates adaptation. We explain how social heterosis is triggered by the reconfiguration of organizational boundaries and how periodic reconfiguration helps sustain variation. The paper offers new insights into how boundary-changing events can mitigate competency traps.

Title: Evolution of Capabilities for Global Service Delivery: A Study of Emerging Economy Software Firms


  • Amit Karna, Indian Institute of Management Ahmedabad
  • Mukund Dixit, Indian Institute of Management-Ahmedabad
  • Sunil Sharma, Indian Institute of Management - Ahmedabad

Abstract: Strategy literature in the recent years has witnessed a shift towards investigating the evolution of capabilities. This has added to the understanding of the capability building phenomenon, but in isolated studies. Through this study, we attempt to provide a unified explanation for building capabilities for global service delivery. We carry out a multiple case-study based research in the emerging economy of India. We provide evidence of industry evolution in four phases: Origination, Entrepreneurial, Growth and Self-propelling. Based on case-studies of three software services firms, we develop a capability building model to infer the GDM capabilities developed. We propose four stages of capability evolution: Initiation, Establishment, Replication, and Value-adding stages. We discuss the findings and key contribution of the study towards the field of capability development.

Title: A Capability Perspective to Organizational Change within the MNC Context


  • Markus Paukku, University of Amsterdam
  • Paula Kilpinen, Aalto University

Abstract: The aim of this paper is to contribute to the organizational capabilities discussion by drawing upon research in international business where the role of context is strongly emphasized. This contextualized analysis allows for a discussion on the impact of the internal and external environment on firm capabilities during organizational change. An understanding of the interplay between the internal and external environment puts this capability research in a position to make an empirical contribution in line with the co-evolution logic. Finally, reflecting on the basis of negotiated and privileged access to the multiple case firms’ managers and data the paper proposes that capabilities scholars recognize the heterogeneity both within their researched firms and their environments and the multiple paths that can lead to the same outcome.

All Sessions in Track A...

Mon: 12:45 – 14:00
Session 188: Market Pressure, Social Responsibility and Firm Performance
Mon: 15:45 – 17:00
Session 187: Market Conditions and Firm Internationalization
Mon: 17:15 – 18:30
Session 189: Risk Management in Uncertain Environments
Tue: 10:00 – 11:15
Session 190: Building up Firm Capabilities for Unstable Environments
Tue: 11:30 – 12:45
Session 191: The Role of Managers in Adapting to Uncertain Conditions
Wed: 10:00 – 11:15
Session 247: Managing Innovation in Uncertain Environments
Wed: 11:30 – 12:45
Session 246: Strategic Responses to Turbulent Environmental Conditions

Strategic Management Society

Washington DC